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Outsourced Call Centers Losing Feasibility?
Daniel Pronych writes "BusinessWeek is running an article about how outsourcing call centers in India are no longer an 'inexpensive option' for American companies. These shops are now striving for better outsourced work from the U.S. and Europe multinational companies; many are fed up with U.S. clients trying to continually lower prices. New Delhi-based EXL Services, for example, terminated a contract with Dell Inc. because EXL was losing money in the deal."
If the call center jobs get moved to the US,etc... will Indians complain about their jobs being outsourced?
In the UK we have had a lot of companies who outsourced their customer care to India, but because of this there has been a real backlash against companies who have done so at the expense of British workers. Now you often see in adverts people advertising that they have UK call centers only. I wonder if it is maybe becoming unworkable for both sides in these deals.
*''I can't believe it's not a hyperlink.''
IHMO, Outsourced Call Centers were never feasible. They just seemed feasible.
Corporations *should* have a social responsibility and conscience. Look at any big, sparkling technology park anywhere in the world and you see housing and transportation links springing up around it - purely because most people want to live close to where they work.
Consequently, when these same corporations suddenly decide to move thousands of jobs overseas, offices close down and entire communities can be devastated through unemployment.
The logical solution, therefore, should have been additional taxation on the corporations by government - very simply, each nation works out how much profit a company makes in their country (i.e. how much money it takes out) and compares it to how much money it spends on employing people in their country (i.e. how much money it puts back in). Then just subtract the second from the first and, if it's positive, tax the hell out of it.
And before anyone flames me about being "anti-capitalist", I'd remind them that when people lose their jobs and, say, private health care benefits, they turn to the government for unemployment handouts and public healthcare - both of which are financed from our taxes.
Gentoo Linux - another day, another USE flag.
The funny thing is all of your ideas ARE anti-capitalist. No one is accusing you of being anti-capitalist, you are simply proposing solutions that are anti-capitalist.
Whether capitalism benefits or does not benefit us doesn't make your ideas any more or less capitalist. Just because people will turn to welfare if insurance doesnt exist, doesn't make welfare any less socialist. Welfare is simply one aspect of socialism in the American government. It doesn't make any sense to try and avoid socialism through more socialism. If the law that made tarrifs eliminated welfare then maybe you would have a point.
At least most capitalists have the balls to call their ideas capitalism rather than trying to label socialism capitalism. Just say it, you like socialist policies. I don't in general, but it's a free country so no one is going to put you in the gulag or send you to be reeducated cutting sugar cane if you want to change a law.
I don't need to "flame" you for being anti-capitalist its clear to anyone who can read and knows what capitalism means knows that the state using taxation to redistribute wealth is as anti-capitalist as it comes. Exactly which of your ideas aren't anti-capitalist?
It used to be like that in many European countries. Americans called that socialistic or communistic.
When a large company had problems, the government would take action like buying products from them, subsidizing research or construction, etc.
It worked for a while, but then the first examples of fraudulous management who put the government money in their own pockets or their own adventurous projects appeared.
It seems like greed will always win from responsibility.
Now, we have the EU. Instead of moving jobs outside the EU, new low-wage low-welfare countries are added to the EU faster than you can imagine, and companies are encouraged to move their jobs there. This results in some fictitious good economic results, but of course when you are losing your job because of this, you'll look at it in a bit different way.
Imagine that the USA would expand to include Mexico and middle-american states "because there are so many people there that want to work and expand our economy". That would be like what the EU does.
Small wonder that those countries where the people were asked their opinion voiced a strong NO. However, it will take something stronger to really wake up the EU politicians.
Odd... Jobs leave the US for India, causing Americans to get hungry. Then Indian outsourcers start rejecting those jobs because they pay so low the Indians go hungry. Sounds like there's a worldwide hunger crisis in the works, so to speak.
So if India can demand better wages and reject outsource work, can America have those jobs back? We already know the language. Or will we have to wait until Business is done exploiting China and the third- and fourth-world countries? Some companies have come to their senses, but not all and not fast enough.
Which brings to mind a Dilbert strip about how the outsourced work had been so undercut while being bounced to foreign markets that eventually it went to the lowest bidder -- the original company.
Laughter is the Spackle of the Soul.
Creating employment in a third world country doesn't strike me as particularly evil.
Czech language for absolute beginners
I should firstly say that I'm a UK resident, not an American, but outsourcing from British companies is just as bad.
Also, I'm not trying to deny jobs to people in emerging economies who can work for lower salaries because houses and the cost of living are also much lower in those countries - that's how capitalism works.
However, whether it's in the US, the UK or India, the activities of corporations change the societies around them. Salaries are higher in the Western World because demands for housing near to places of work has increased the cost of them meaning that people have needed to earn more. Sure, there's personal greed in there also but then that's no different to Indian workers demanding higher and higher salaries also - people are the same the world over.
Unfortunately, at the drop of a hat, any corporation currently has free reign to make decisions at board room level that affect the lives of thousands of workers - and if those workers mostly live near to their offices, then an entire community can be devastated; this leads to more drain on government money (for benefits) and perhaps even forces local, smaller businesses to crash also.
My point of argument is that corporations should be stopped from making "snap decisions" by higher taxation of their profits - after all, despite reducing jobs in certain countries, those corporations still expect to make as much, if not more money from those same countries.
Gentoo Linux - another day, another USE flag.
I work at a Canadian office of an outsourcing company that opened offices in India.
I've actually had a conversations start with "Finally, someone in North America.", "Great, a Canadian. Better you than India." and many other anti-offshore statements.
And that's not even getting into some of the rather rude comments that people make towards our Indian coworkers. I especially feel sorry for immigrants from India/Pakistan/etc. who are IN Canada, but get treated just as badly as if they were IN India.
And of course, I've dealt with India call centers as a caller. While I'm patient towards them because I know exactly what they have to go through, I'm less than satisfied with the level of service I get sometimes. I'm not surprised in the slightest that India firms are ramping up their rates.
Oh, and something interesting I've found out recently, is that there are also some firms opening up in Latin America. Why? Because they can support English and Spanish.
The reason why people don't like outsourced call centres isn't usually because they are in India (however if it has lead to loss of local jobs people dislike that too). It's because things are generally made harder. The people in India aren't generally very good at speaking English, and commonly fail to understand what you are trying to say. They also generally are of little help. If you have a problem, you are either put on hold, or relayed a manual (which you have probably already read). They also are usually rather powerless - there *is* very little they are able to do - they are just made to 'deal' with people - and this just annoys most. Since they usually know so little about the subject you are calling about, working with outsourced call centres is just like flogging a dead sheep. They also probably think the same about dealing with angry customers. It's all about profit now, not customer service, and not about keeping the customer happy. If the customer is unhappy but they stay with the company - then their business model is working. However if you leave the company, you just receive the same level of service elsewhere.
I wouldn't write off outsourcing just yet. If the US increases the minimum wage as proposed, this may pretty firmly establish a class of jobs that are much inherently cheaper to fill offshore when possible.
You're missing the whole point of customer call centres. They aren't there to help customers; they're there to get customers to go away. Call centre workers are evaluated based on how long they spend on each call, not on how satisfied the customer is when they've finished. That should give you an idea of the call centres' priority. For the most part, they exist only so they can tell a customer how the company they represent is not liable for whatever fault the customer finds with their product or service.
Companies that take their call centers seriously provide people who are informed about their particular industry, and their company's products in particular. You don't get that sort of familiarity by sending over a bunch of scripts to a generic Indian call centre. You get it by making your customer support team an integral part of your business.
Just because you're paranoid doesn't mean there isn't an invisible demon about to eat your face
I work in one of the six main utility companies in the UK. We've just taken the decision to return all our work in house, from India. The reason we've done this is mainly that outsourcing doesnt work, but is also because we're moving away from a command and control environment where the work is broken down into small amounts and processed ad infinitum by the worker, which made outsourcing so attractive. We're moving to a system thinking/lean model like Toyota's production line being the main example. The, i've got 200 workers that can do 2000 units of work at $x amount means that there are targets in the system. Once you get targets you're defining that once they've done 2000units of work they are effective and its even better when we can get the work done cheaper. Problem is that those 2000units of work havent been done effectively. They've been fudged, the ticket has been resolved for instance but the actual customers problem hasnt so they'll raise 4,5,6,7 tickets all 'resolved' each time as a unit of work for the outsource, making the management happy by meeting the target but the customer is still pissed off and has taken there custom else where as they've never resolved the problem. The trick is to look at how the work works and improve the system. not break it down into a series of units and whore it to the cheapest bidder. Once you improve the system you can view what work is waste and value. IE one office receives a number of bits of paper staples whacks them in an envelope and sends them to another office where they employ someone to take the staples out. Why staple it? turn off that bit of work and free that employee to actually look at that work and work it. Yes, i've been sold on it, but then again it actually works. In 12months we've gone from 90% above average for customer complaints to 60% below average and have overtaken most of our rivals and our catching the rest up. Not only that moral in the company has really improved too. Personally my little rant doesnt do justice to how well its working and will continue to work for us.
Oh get real!
All large businesses and plenty of small ones are constantly at the government's teat in the USA. Big Business in america is forever lobbying for more and more corporate socialism and calling it capitalism in order to justify it. Some entire industries are based on government subsidies - either direct money transfers like ADM gets or indirect subsidies as side effects of legislation like the big telecoms get.
When information is power, privacy is freedom.
There's a good section in the book "Lean Solutions" by Womack and Jones, that looked at Fujitsu Services UK applying lessons from the Toyota Production System on their call centre business. Instead of measuring # calls handled, # rings, # tickets closed, they ended up persuading clients to compensate them on the number of people who *could* potentially call them... and then set about doing rigourous "root cause" analysis and corrections to stop customers having to call in the first place. The end result being that more customers were satisfied, call volumes dropped dramatically, level of service went way up while the costs plummeted.
Most call centres are still back in "rote stock answers territory", so the life of the end consumer never gets to improve. In the final analysis, it's the fault of the company who decides to outsource in the first place. If they got a statistician or someone who could map out customer value streams, they'd save more costs than outsourcing to the cheapest battery farm - wherever it is located..
Ian W.
"wake up the EU politicians"
:-)
You are forgetting that EU isn't only about economy, but about culture and security as well. The east-west division is unsupported by Europe's history.
Not to jab at you, but it's funny how economists have hijacked all decision-making and ways of thinking. We might be better off with people from the other "angles" in gov't and media leadership. Now it's like a buncha mathematicians running all Science...
Hope you get what I mean
Outsourcing usually involves getting rid of entry level positions in a company. Look at the job ads today and the current "Junior" or "Entry level positions" in IT require years of experience just to be considered. It used to be that if you graduated college, you had a shot at the first rung in the company.
Now that there is no low level pool of workers in the company to promote, businesses are having a hell of a time finding people to hire for higher level positions. I was just looking at http://www.avaya.com/gcm/master-usa/en-us/corporat e/careers/careers.htm, a local branch. Every single one of their job ads required 5 to 8 years of experience in the specific job field. Almost every time I talk to someone about how hard it is to find good IT help, I tell them to grab someone from their internship program. Usually their response is "Oh, right, we should implement one of those."
And if all human beings are equally deserving of those opportunities, then you should be against outsourcing. Because those opportunities are no longer available in the host country.
Democrats or Republicans. They are both taking us to the same place and they are not afraid of us anymore.